Building Societies report record deposits

by Gill Montia

Story link: Building Societies report record deposits

The Building Societies Association (BSA) has recorded the largest monthly inflow of savings since 1997.

In January, deposits totalled £597 million, having been steadily rising since last summer and the advent of the credit squeeze.

Commenting on the figures, Adrian Coles, Director General of the BSA, said: “January figures often show a net outflow as families pay off Christmas bills, with seven in the previous 10 years seeing net withdrawals. Placed in this context, the savings inflow in January was particularly high.”

Adding: “The attractive savings products that societies are offering, coupled with the volatility of share prices, have attracted savers into societies, while the continuing economic uncertainty is encouraging further saving.”

Gross mortgage lending during the month remained at around the same level as January 2007, however, net lending (borrowing minus repayments) was higher in January than in the latter part of 2007.

In related news, the latest MoneyMood Survey from Legal & General (L&G) suggests that women respond more readily to the credit squeeze than men, in terms of curbing their spending.

The survey shows an 18% decline in the female “mood to spend” index, while men remained largely unchanged in their spending habits.

The L&G research also highlights a generation gap, with 25% of 18 to 24 year-olds still in consumerist mode, compared to 17% of 45 to 54 year-olds.